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ERISA Wrap Document
Are you in Compliance?
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Contact GeoStar today!
GeoStar will provide an ERISA compliant
Wrap Document and Summary Plan
Contact
FlexBank!
Description.
For an annual fee of $600, FlexBank will
provide
an ERISA
compliant Wrap
GeoStar
Professionals,
LLC.
Document and Summary Plan Description.
23 S Lisbon St. Suite M
Canfield,
OhioInc.
44406
FlexBank,
1.888.GeoStar: Toll Free
1250 W Dorothy Lane, Suite 107
330.319.6242: Fax
Dayton, Ohio 45409
www.GeoStarProfessionals.com
888.677.8373: Toll Free
937.299.5515: Phone
937.299.5609: Fax
What is a Wrap Document?
ERISA requires all private sector employers, regardless of size, to
automatically distribute a summary plan description (SPD) to all
plan participants free of charge. Insurance companies provide a
booklet or certificate that explains the benefits. However, most
booklets and certificates do not comply with the ERISA requirements
applicable to SPDs. The easiest way for employers to comply with
ERISA is to adopt a Wrap Document.
The insurance certificates do not include ERISA required
language for SPDs, for example:



plan number and plan year
employer’s tax ID number
name and address for the Plan’s legal agent
Who needs an ERISA Wrap Document?
Employers who offer insured or self‐funded group benefits. This
includes all types of group health plans such as major medical,
dental, vision, group term life and disability benefits to name a few.
This document requirement is in addition to any plan document you may
already have for a pre-tax benefit plan (i.e. premium only plan, flexible
spending account, health reimbursement arrangement).
23 S. Lisbon St. Suite M Canfield, Ohio 44406 1.888.GeoStar: Toll Free ~ 330.319.6242: Fax
ERISA Wrap Document
ERISA Wrap Document
The Employee Retirement Income Security Act of
1974 (ERISA), was designed to protect individuals
enrolled in health plans. This law does not require
employers to establish benefit plans, but it does
require employers to provide employees certain
information in writing about their welfare benefits.
Does ERISA Apply?
ERISA applies to all private sector welfare benefit
plans, which are defined as any plan, fund or
program established or maintained by an employer
for the employees and their family members that
provide benefits such as: health plans, dental plans,
vision plans, group term life insurance plans,
accidental death and dismemberment insurance and
disability benefits just to name a few. Both selffunded and fully insured plans are subject to ERISA.
Most employers make sure they comply with ERISA
when it comes to their retirement plans, such as their
pension, 401(k) and profit sharing plans. But, few
employers make sure they are complying with the
ERISA requirements applicable to their welfare
benefit plans. The U.S. Department of Labor is
conducting more ERISA compliance audits and
employers need to make sure they are complying with
the documentation, disclosure and annual reporting
requirements for all plans. A Wrap Document will help
employers meet these ERISA obligations.
ERISA mandates that every plan be in writing and
the employer automatically provide every participant
an accurate and comprehensive summary plan
description (SPD) free of charge.
What in the world is a Wrap Document?
A Wrap Document is a document that “wraps” around
the insurance policy, certificate or booklet so that the
plan sponsor complies with ERISA. The plan benefits
continue to be governed by the insurance policy,
certificate or booklet, but the Wrap Document
supplements that information so that the combined
documents comply with ERISA. Basically, the Wrap
Document fills in the gaps left by insurance carriers so
that the employer complies with the ERISA
requirements applicable to SPDs. In other words,
most insurance company’s documents do not
include ERISA required SPD language.
Plan Document Requirement
ERISA requires every plan be established and
maintained pursuant to a written plan document.
The written plan document must clearly identify
certain basic information about the plan, including:
The named fiduciary who will have the authority
and responsibility to administer the plan.
Procedures for amending and terminating
the plan.
The source of plan contributions.
The allocation of responsibilities for the operation of
the plan between the employer and the insurance
carrier or third-party administrator.
Summary Plan Description
ERISA also requires the employer to provide all
participants the summary plan description (SPD). This
is in addition to the requirement that the employer
provide a summary of benefits and coverage (SBC).
The Department of Labor describes the summary
plan description as “the primary vehicle for informing
participants and beneficiaries about their rights and
benefits.” Employers are required to provide each
plan participant a free copy of the SPD. Failure to
provide a participant with the SPD in a timely manner
can result in a $110 per day penalty.
The SPD must describe all of the important plan rules
and the benefits available under the plan, as well as
key information about the plan, including but not
limited to: plan name, employer’s name, address and
employer tax identification number, name, address
and telephone number of the plan administrator, the
plan number for annual reporting purposes to name a
few.
What Next?
GeoStar has the expertise to prepare an ERISA
compliant Wrap Document and summary plan
description.